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Scale Development and Construct Validity of Organizational Capital in Customer Relationship Management Context: A Confirmatory Factor Analysis Approach

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  • Waseem John

Abstract

Effective usage and implementation of customer relationship management (CRM) or information technology requires some prerequisite organizational commitments and changes. Improving and deploying the organizational resources, such as top management support and employee training, which are collectively pursued under the umbrella term, that is, organizational capital, appears to be one of the important transformations that organizations need to undertake. Organizational capital is one of the key determinants in improving the results from CRM implementations. This article proposes organizational capital as a multidimensional construct. Further, this article attempts to develop a scale for measuring the organizational capital and test its factorial validity through confirmatory factor analysis (CFA). To test the proposed theoretical model, primary data were used which was generated through a survey of some selected pharmaceutical companies in India. The data were analyzed using exploratory factor analysis (EFA) and subsequently CFA. The results demonstrated that CFA of organizational capital showed an acceptable fit to the data and this construct is best represented by three constituent elements, that is, employee training, customer-centric management system (CMS), and customer relationship orientation (CRO) in current research context. This scale may be used in future research for measurement of this construct as a whole with contextual validity check. Further, implications for theory and practitioners are presented.

Suggested Citation

  • Waseem John, 2019. "Scale Development and Construct Validity of Organizational Capital in Customer Relationship Management Context: A Confirmatory Factor Analysis Approach," Business Perspectives and Research, , vol. 7(1), pages 76-91, January.
    • Handle: RePEc:sae:busper:v:7:y:2019:i:1:p:76-91
    DOI: 10.1177/2278533718800600
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    References listed on IDEAS

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    1. Rajiv Sabherwal & Anand Jeyaraj & Charles Chowa, 2006. "Information System Success: Individual and Organizational Determinants," Management Science, INFORMS, vol. 52(12), pages 1849-1864, December.
    2. Sandra E. Black & Lisa M. Lynch, 2005. "Measuring Organizational Capital in the New Economy," NBER Chapters, in: Measuring Capital in the New Economy, pages 205-236, National Bureau of Economic Research, Inc.
    3. Carol Corrado & John Haltiwanger & Daniel Sichel, 2005. "Measuring Capital in the New Economy," NBER Books, National Bureau of Economic Research, Inc, number corr05-1.
    4. Ryals, Lynette & Knox, Simon, 2001. "Cross-functional issues in the implementation of relationship marketing through customer relationship management," European Management Journal, Elsevier, vol. 19(5), pages 534-542, October.
    5. Becker, Jan U. & Greve, Goetz & Albers, Sönke, 2009. "The impact of technological and organizational implementation of CRM on customer acquisition, maintenance, and retention," International Journal of Research in Marketing, Elsevier, vol. 26(3), pages 207-215.
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